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U.S. Dollar Index (DX) Futures Technical Analysis – Long-Term Pivot at 96.500 Next Major Upside Target

By:
James Hyerczyk
Published: Nov 17, 2021, 06:02 UTC

The direction of the December U.S. Dollar Index on Wednesday is likely to be determined by trader reaction to 95.910.

US Dollar Index

In this article:

The U.S. Dollar is trading higher against a basket of major currencies for a third straight session early Wednesday, hitting nearly a 16-month peak as a run of strong economic data boosted bets for earlier Federal Reserve interest-rate hikes.

The index is being primarily supported by stronger-than-expected U.S. economic data, hawkish Fed policymaker comments and extreme weakness in the heavily-weighted Euro.

At 05:34 GMT, December U.S. Dollar Index futures are trading 96.035, up 0.124 or +0.13%.

The Bullish Catalysts

U.S. retail sales rose more than expected in October, a report showed Tuesday, building on momentum from last week when data showed consumer prices surging at the highest rate since 1990.

St. Louis Fed President James Bullard said on Tuesday that the central bank should “tack in a more hawkish direction” over its next couple of meetings to prepare in case inflation does not begin to ease.

The Euro languished near a 16-month low to the dollar as Europe suffered from worries about growth amid a renewed surge in COVID-19 cases.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through the intraday high at 96.270 will reaffirm the uptrend. A move through 93.865 will change the main trend to down.

The minor trend is also up. A move through 94.965 will change the minor trend to down. This will also shift momentum to the downside.

The nearest upside target is 50% of the 20-year range at 96.500.

The minor range is 94.965 to 96.270. Its 50% level or pivot is potential support at 95.620. Additional support is another pivot at 95.070.

The short-term range is 93.265 to 96.270. If the minor trend changes to down then look for a test of its retracement zone at 94.770 to 94.410.

Daily Swing Chart Technical Forecast

The direction of the December U.S. Dollar Index on Wednesday is likely to be determined by trader reaction to 95.910.

Bullish Scenario

A sustained move over 95.910 will indicate the presence of buyers. Taking out the intraday high at 96.270 will indicate the buying is getting stronger with the long-term 50% level at 96.500 main target.

Aggressive counter-trend sellers could come in on the first test of 96.500, but overtaking it could trigger another acceleration to the upside.

Bearish Scenario

A sustained move under 95.910 will signal the presence of sellers. If this move generates enough downside momentum then look for the selling to possibly extend into the minor pivot at 95.620.

Since the main trend is up, look for buyers on the first test of 95.620. If this level fails as support then we could see an acceleration into the next pivot at 95.070.

For a look at all of today’s economic events, check out our economic calendar.

About the Author

James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.

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